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| The Lightstone Group Completes $625.5 Million Acquisition of Prime Retail, Inc. |
LAKEWOOD, N.J., Dec. 11 /PRNewswire-FirstCall/ -- The Lightstone Group,
LLC ("The Lightstone Group"), and Prime Retail, Inc. ("Prime Retail")
(OTC Bulletin Board: PMRE, PMREP, PMREO) announced today that they have
completed the sale of Prime Retail to an affiliate of The Lightstone Group
(the "Lightstone Affiliate") for approximately $625.5 million, including
aggregate consideration of $115.5 million payable to stockholders and unit
holders and The Lightstone Group's assumption of approximately $510 million of
debt. The transaction continues The Lightstone Group's aggressive national
acquisition strategy.
The sale was accomplished by merging the Prime Retail into Prime Outlets
Acquisition Company, LLC, a Delaware limited liability company and an
affiliate of The Lightstone Group pursuant to the terms of the previously
announced merger agreement between Prime Retail and the Lightstone Affiliate.
In the merger, each share of Prime Retail's outstanding Series A preferred
stock was cancelled and converted into the right to receive cash in the amount
of $18.40 per share, each share of Prime Retail's outstanding Series B
preferred stock was cancelled and converted into the right to receive cash in
the amount of $8.169 per share, and each share of Prime Retail's common stock
was cancelled and converted into the right to receive cash in the amount of
$0.17 per share. Letters of transmittal regarding the procedures to receive
the merger consideration will be promptly sent to the former stockholders of
the Company.
Concurrent with the closing of the merger, the agreement of limited
partnership of Prime Retail, L.P., the operating partnership through which the
Company conducts substantially all of its business (the "Operating
Partnership"), was amended and restated (the "Amended Partnership Agreement")
pursuant to which the common units in the Operating Partnership (other than
common units held by the Company) were converted into a like number of
preferred units in the Operating Partnership ("Preferred Unit"). Each holder
of Preferred Units will be entitled to, among other things, require the
Operating Partnership to redeem all of such holder's Preferred Units for an
amount per unit equal to $0.17 (the same consideration paid for a share of
common stock of the Company in the merger) plus accrued and unpaid
distributions at the rate of 6% per annum.
Angela Mirizzi-Olsen, senior vice president and chief investment officer
for The Lightstone Group, and Jonathan Gould, principal of The Lightstone
Group, played crucial roles in the structuring and completion of this
transaction. This acquisition is expected to facilitate the stabilization of
Prime Retail and its properties, and allow for future growth and re-
investment.
The Lightstone Group President and CEO David Lichtenstein commented,
"Having negotiated and closed on hundreds of transactions, I am probably more
excited about this one than any other we have concluded in the past. Prime
Retail is a wonderful company with great people and a bright future."
Prime Retail CEO and Chairman Glenn D. Reschke stated that today's
announcement is positive news for more than just the two companies. "As I've
said all along, everyone should benefit from this transaction. Our
shareholders realized cash values significantly above the market price for our
stock just six months ago. For our tenants, the relationship with The
Lightstone Group will provide us with the capital to finish the rehab of our
centers and the expansion of our marketing efforts. Our customer's shopping
experience should improve further as we continue to bring new and exciting
famous brand names into our centers. And finally, our employees can feel more
assured about the financial strength of our company and the continued
operations of Prime Retail's headquarters in Baltimore."
Bob Brvenik, president of Prime Retail, added that the successful
transaction was a tribute to the employees of both companies. "The completion
of this transaction is the result of many, many hours invested by the teams of
both companies and a testament to the hard work and dedication of a lot of
people."
"This is a great fit for both companies. Our plan is to work with the
talented team of professionals that Prime Retail has assembled in Baltimore
and re-invest in the company in order to become a dominant owner/operator of
retail properties," commented Gould.
The Prime Retail portfolio spans 23 states and 10.2 million square feet of
space, including 36 outlet centers and 154,000 square feet of office space.
For additional information on Prime Retail, please visit http://www.primeretail.com.
This acquisition brings The Lightstone Group's portfolio to a total of 19.3
million square feet of office, retail and industrial properties as well as
16,000 apartment units throughout the United States and Puerto Rico.
Throughout 2003, The Lightstone Group has been one of the most aggressive
buyers of retail, industrial and multi-family real estate in the United
States. The Lightstone Group's portfolio has a market value approaching $2
billion. The Lightstone Group owns/manages a diversified portfolio of 16,000
apartments as well as office, industrial and retail properties totaling more
than 19.3 million square feet of space in 26 states and Puerto Rico.
Headquartered in Lakewood, New Jersey, The Lightstone Group employs over 1,000
professionals and maintains offices in Baltimore, Maryland; New York,
Virginia, and California. For more information on The Lightstone Group,
contact the company's headquarters at 800-347-4078 or visit their website at
http://www.lightstonegroup.com.
Some of the statements contained herein which are not statements of
historical facts are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 that reflect management's
current views with respect to future events and financial performance. The
words "believes," "expects," "anticipates," "estimates" and similar words or
expressions are generally intended to identify forward-looking statements.
Actual results may differ materially from those expected because of various
risks and uncertainties, including, but not limited to, changes in general
economic conditions, adverse changes in real estate markets as well as other
risks and uncertainties included from time to time in the Company's filings
with the Securities and Exchange Commission. Prime Retail accepts no
responsibility for updating forward-looking statements.
SOURCE Prime Retail, Inc.
back to topRelated links:
Company News On-Call:
CONTACT:
David W. Lichtenstein, President and Chief
Executive Officer, The Lightstone Group, +1-732-367-0129 or
Media: Michael D. Beckerman, Beckerman Public Relations,
+1-908-781-6420, michael@beckermanpr.com, for The Lightstone
Group; or Investors: Robert A. Brvenik, President and Chief
Financial Officer, +1-410-234-1750, or Media: Steven A. Sless,
Director - Public Relations, +1-410-234-8333, both of Prime
Retail
